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Solar power helped Europe save billions of euros in this summer’s energy crisis.

During a difficult summer for Europe that brought record energy prices and sweltering heat waves, Solar power provided some much-needed relief. 

Analysis by CB shows that record solar levels in the EU this summer avoided the need to import 20 billion cubic meters (bcm) of gas, which would have cost 29 billion euros (£25 billion) for imports. 

The success of solar can help overcome the energy and climate insecurity the EU is currently facing. 
Many EU countries have increased their renewable energy targets amid soaring gas prices and Russia’s invasion of Ukraine, seeking to replace expensive gas imports. The upcoming EU-wide policy discussions could mean solar power playing a much larger role in the EU’s future electricity system. 

Solar Record 

Europe is currently facing an energy crisis on an unprecedented scale. Russia’s pressure on fossil fuel supplies is pushing electricity prices to unprecedented levels, adding to the stress over the unavailability of nuclear reactors in France and the drought affecting hydroelectricity production in many parts of the world. 
At the same time, solar power provides record output in the summer of 2022, helping to keep the lights on and reduce the EU’s vital gas consumption. 

As the chart below shows, EU solar production increased by 28% in the summer of 2022 (May-August), compared to the same period a year earlier. 
Without the record solar power output in the past four months, the EU would have to buy an additional 20 billion cubic meters of gas at a cost of around 29 billion euros (£25 billion). Solar power alone, added in 2021, has avoided 6 billion euros (£5 billion) in gas imports. 

During the summer months from May to August, solar generates a record 12% of total electricity in the EU, up from 9% last summer. This puts it on par with wind and ahead of hydro, though it’s still four percentage points behind coal. 

Furthermore, solar energy is developing very rapidly. The EU has seen a steady 15% year-over-year increase in solar installed capacity – from 10
 GW in 2018 to 162 GW in 2021. The surge in solar production this summer shows that the accumulated capacity is paying off. 

 

Fastest growth 

Solar’s rapid growth is happening across Europe. 

Some 18 EU countries have seen solar power generate a record share of summer electricity generation. 
The Netherlands produced almost a quarter of its electricity from solar this summer (23%), the highest share in the EU. Following closely are Germany (19%) and Spain (17%). 
A combination of financial incentives and government initiatives is driving the growth of solar power. The fact that countries in Southern and Northern Europe are developing solar power shows that sunshine is not only a valuable but an effective policy

The Netherlands, for example, has seen huge solar growth—albeit at higher latitudes—supported by ambitious national targets. 
The fastest growing solar output since 2018 happened in Poland. The country has increased its solar power generation by 26-fold – albeit from a low level – following a boom in rooftop solar power for homes driven by photovoltaic subsidies and rising coal and gas prices. 

The chart below shows the main electricity-consuming countries in the EU. Most of them have broken solar production records, reaching a higher solar market share this summer (red dot) than last summer (gray dot). Two new countries crossed the 10% mark this summer: Belgium and Denmark. Across 27 EU member states, 18 have broken solar records this summer. 

There is some evidence that the energy crisis is accelerating the development of solar energy. Consumers across Europe, from Germany to the UK, are turning to solar panels to reduce their energy bills. 

Google Trends revealed that search terms related to solar panels hit all-time highs this summer in major economies like Germany, the UK, France, and Spain. With the International Energy Agency (IEA) declaring that solar power in the right places now provides the cheapest electricity in history, its rapid growth looks set to continue. 

 

Political orientation 

Solar power has been helping Europe get rid of expensive gas. Most EU countries have increased their wind and solar ambitions in response to the current crisis. 
The European Commission’s recent REPowerEU proposal would aim to double solar capacity by 2025 from 2020 levels, as part of achieving an updated target of 
5% renewable energy by 2030. 
The proposed goal is to amend the Renewable Energy Directive, which sets a legally binding target of 32% renewable energy by 2030. If the updated target is adopted Next week’s European Parliament vote and negotiations with member states will put the EU on the path to achieving 600 GW or more of solar capacity by 2030.

With exorbitant gas prices continuing for several years, faster solar deployment will help reduce the need for expensive fossil fuel imports. 
This will also help achieve the bloc’s climate goals. 

The model suggests that the lowest-cost path to limiting the increase in global temperature to 1.5 °C above pre-industrial levels would include a 9-fold increase in energy production. Solar energy in Europe by 2035 Although the definition of ambitious targets is a first step towards expanding solar deployment, the next necessary step is implementation. 

Solar power was built quickly, but obstacles prevented its rapid deployment in many European countries. Ember’s recent analysis shows that projections of annual solar capacity additions for the coming years place deployment below what is needed for an EU power system that is compatible with climate targets. 

Long wait times for permits are a major obstacle to faster solar growth. Our research shows that project development times exceed legally binding EU limits in many countries. 

Several places with high solar potential, including Italy, Portugal, and Croatia, are experiencing significant permit delays, with project completion times of up to four years in Croatia. 
Working to ease these bottlenecks could help achieve the EU’s higher solar targets. This not only reduces the need for expensive gas imports and eases pressure on energy bills, but also helps meet the bloc’s climate goals.

Source:CB

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